Oil prices went mixed on Monday. Mixed means one contract went up and another went down. Traders are calling this volatility. The rest of us call it a rounding error.
The U.S. and Iran exchanged military strikes over the weekend. This reignited supply fears from the Middle East, a region that has been on the verge of catastrophic supply disruption for roughly forty-seven consecutive years. Any day now.
Brent crude ticked up. WTI ticked down. Retail traders are now convinced they've unlocked the geopolitical risk premium. They have not unlocked the geopolitical risk premium. They've unlocked a reason to refresh their brokerage app every six seconds while their portfolio bleeds out from commission fees.
Here's what actually happened: nothing. Iran and the U.S. have been doing this exact dance since 1979. The Strait of Hormuz remains open. Tankers keep moving. Supply chains continue functioning. But every single time someone fires a missile near a oil field, some guy in Michigan with a Robinhood account decides he's Henry Kissinger and loads up on USO calls.
The headline says supply fears were reignited. Supply fears are never extinguished. They just sit there smoldering in the background waiting for cable news to add kindling. This is the financial media equivalent of leaving your gas stove on low for half a century and pretending you're worried about a fire.
Oil closed Monday essentially flat. The mixed price action reflected exactly what you'd expect when nothing meaningful changed. But retail traders are already mapping out their yacht configurations, convinced they nailed the Iran desk's proprietary geopolitical model by reading a Reuters push notification while taking a shit.
Somewhere in Texas, an actual energy trader yawned, checked the curve, and went back to his coffee.
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